New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1887-06-11
THE PROFITS OF THE ELEVA1ED ROADS,

MR. SCHULTZ DRAWS TIE DISTINCTION BETWEEN
WATER" AND PROFITS.
The Rapid Transit Commission considered yesterday
the subject of recommending the imposition of Tax
for the franchises accompanying the Terry extensions
of the elevated railway system Assistant corpora
finn Counsel Wickes was present for the city, ana
Julian T. Davis osented the Manhattan Railway
Company.
Commissioner Schultz put few direct questions TO
Mr.. Wickes 1.-TWO parties said Mr.. Schultz, " un-
derake to build two elevated railroads. Large sums
OF moaey fisxed in the enterprise "hen they get
starte they find that il is desirable to effect union
The project proves Instead OF their Sc
curiies sci ag so they 60 TO 10 or 49, The law
prohibits two parallel lines from consolidating They
organize third company Now, how shall they lis
pose OF their stock; upon OAR Vaiudton Ut ~ INC
market price !"
Mr.. Wickes admitted that be thought the basis OF
sale should be upon q market value. " Them" asked
Mr.. Schultz, {" does the difference represent what is
called water or does 1t represent profit I"
Mr. Wickes thought it looked like profit, but, lie
added when we look at these nllions ol captal ana
sea what this company has earned, feel that the
city should derive some 6eneht IRON the ifancn'se
which tho company eDjoys'
Then Mr; Schultz put another proposition You
estate boomers claim that owing 20 the penetI alton
by the elevated roads the uptown districts real
estate has gteatv advanced in price, and that tact has
resulted In increased taxation and eonsequehtly IN,
creased TO the CITY, La this view the elevated
roads have contributed large pecuEarY Dement'S 10 the
cty aside from the increased facilities in the way OF
transportation at low rates
Mr. Wlckes suggested that the Tax Department
would be better able to express an opinion on that
point than the flee of tie Corporation Counsel.
Then Mr. 1hurber made suggestion. Suppose
eaid he this commission should decide to impose
OF 40 por cent OF the companys gross receipts as
compen salon Tor the franchise associated with the
ferry extensions AMI the Manhattan Company should
decline TO accept these conditions. The road would
not be built by it, The construction by separate
company might be impossible. In my judgment 1t
wOul be unfortunate thing not TO have these
tensions built. and il would 10 me to be lad
policy to put such conditions upon the work pre-
vent them from being built"
Mr. Wickes thought that such consider atoms should
not weigh with the cOInm sion there were others
who we prepared to bid Tor the franchise in the ght
OF existing facts.
Mr. Davies argued that the company proposed to OK
pend several millions oil dollars il adding three and
tbir, one hundredtbs miles its lines There would
necessarily be increased operating expenses. There
nothing in the situation to justify the assumption
that the ncrea ed traffic growing out OF the extensions
would ever be sufficient to meet the interest the
cost construction and operation. The traffic that
would come 10 the extensions already going 10
surface lines yet no tax those lines sug
gesied. The whole scheme of The city. he said was
simply proposition 10 tax indirectly the franchises OF
the old company by imposing TAX on the new.
The commission held executive session for the
further consideration Of the conditions and articles of
association. end adjourned to meet again on Monday
next al y U clock.